By Joe Forward, Legal Writer, State Bar of Wisconsin

Nov. 14, 2011 – The Wisconsin Supreme Court recently heard oral argument in a lemon law case in which a car manufacturer failed to timely issue a refund to the consumer but alleges the consumer failed to cooperate in bad faith.

Marco Marquez sued Mercedes Benz USA, alleging it failed to refund the purchase price of a faulty automobile within 30 days after reasonable attempts to repair the car failed.

But Mercedes-Benz argued Marquez intentionally acted in bad faith by failing to provide Mercedes-Benz with the necessary information to meet the 30-day refund deadline under Wisconsin’s lemon law, Wis. Stat. section 218.0171.

Ultimately, an appeals court ruled that a consumer does not get double damages if the consumer intentionally thwarts the manufacturer’s attempt to make a refund, and remanded the case to decide if Marquez acted in bad faith in dealing with Mercedes Benz.

Prior to jury trial on remand, the parties disputed the appropriate burden of proof to be applied if a consumer acts in bad faith in dealing with a manufacturer.

Marquez argued that Mercedes-Benz was required to show Marquez acted in bad faith “by evidence that is clear, satisfactory, and convincing to a reasonable certainty,” a middle burden. Mercedes-Benz argued that a lesser burden applied, requiring Mercedes-Benz to prove bad faith “by the greater weight of the credible evidence to a reasonable certainty.”

The trial court sided with Mercedes-Benz and applied the lesser, ordinary burden of proof. Subsequently, a jury ruled in favor of Mercedes-Benz. But the trial court entered judgment notwithstanding the verdict, concluding there was not sufficient credible evidence to conclude that Marquez acted in bad faith.

The appeals court certified the case to the supreme court to decide “the proper burden of proof to be applied to an allegation of intentional bad faith on the part of a consumer in a lemon law action,” among other issues.

The supreme court could decide whether intentional bad faith or negligence is required to estop consumers from asserting lemon law violations, and what burden of proof is required to prove either negligence or intentional bad faith on the part of the consumer.